Business leaders have to work way out of recession

PHILIP MOELLER

November 20, 1991|By PHILIP MOELLER | PHILIP MOELLER,SUN BUSINESS EDITOR

It would seem obvious to any noodlehead that business prosperity is not merely a function of government spending and sponsorship of economic development efforts.

Yet in Maryland and Baltimore, at least, you'd think that business will shrivel up because of the pressed conditions at the state and local levels. That's just about all you hear.

Locally, enough energy to fuel an economic boom has been wasted lamenting the perfectly predictable results of a no-surprise recession. The money isn't there today, and it won't be there tomorrow, either.

It's laudable that Gov. William Donald Schaefer is speeding state public works spending. That will put public dollars to work faster and help boost confidence.

It also would be comforting to view current problems as temporary, and to assume that an economic recovery would bring new tax revenues, stimulate public works spending and lift all of us on a tide of greater government spending.

Unfortunately, it's not going to happen.

Likewise, as far as business is concerned, it might seem like great news if Maryland's corporate leaders of the 1980s could be brought back for an encore.

Well, they're not.

So, here we sit, smack dab in the middle of a serious recession, with a mortally wounded public sector and precious few John Waynes in industry to lead us into better times.

Bad news? Well, yes, but what a great opportunity for new ideas and new leadership.

First, however, we have to face up to reality and begin moving ahead instead of constantly looking backward at the way Baltimore used to be and at how wonderful Maryland's fiscal future once appeared.

Government simply does not have the resources to support better times. Good leaders can still define new agendas and help restore public confidence. But federal, state and local treasuries are tapped out and will remain so for most of the Nineties.

Federal tax cuts would be more fiscal narcotics, bringing together an unusual coalition of pragmatists who want to get re-elected and supply-side ideologists who believe in the Laffer Curve (and also want to get re-elected).

At the state level, where budgets must be balanced and they have no Federal Reserve to create new money, there's strong sentiment to raise taxes, not lower them.

Low interest rates are about the best government assistance we can hope for and, in fact, this kind of accommodative monetary policy will be worth a lot over the many months that will be needed for this anemic economy to recover.

With government largely on the sidelines, however, businesses must take more of the burden of economic leadership upon themselves.

Locally, that means giving the new leaders of our old-line companies a chance to make their marks. And if it takes 20 CEOs at smaller companies to "equal" one departed corporate "Bigfoot," then fine and dandy. Go find them and put them to work. Ditto for the city's minority business leaders.

Baltimore is richly blessed with successful, family-based companies whose size would be both surprising and impressive. They need to be made to feel more a part of this region's future.

Much has been said and written about an emerging generation of private- and public-sector leaders for the region. They have commitment and energy but, apparently, no empowering agenda to set them into action. Let's create one, or pick from those already on the shelf.

Private support and contributions are badly needed for expanding the downtown Convention Center. Matching funds will be sought for a $500,000 federal grant to study building a magnetic levitation rail line between Baltimore and Washington.

The Greater Baltimore Committee's life sciences "vision" deserves support, as does the city's own downtown development agenda.

These are hard tasks, but they don't require buckets of money and they don't hold the region's future hostage to some hoped-for economic miracle that simply won't occur.

Let's get on with it.

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